2 July 2020 | 6 min read

Planning For The Future – Woman’s Guide On Retirement Planning


The first thoughts that might be popping in your mind are, ‘Why is this piece directed only to women? Does a woman need to be smart to retire? Don’t men need retirement guide too?’ Okay, hold your horses! It is a proven fact that women live longer than their male counterparts, and there is a significant and on-going increase in the percentage of single women in India. These two points are reason enough for the urgency of a robust retirement planning for women.

If you are a working woman between the age of 25-35, retirement planning is probably the least of your worries. However, you should think about it because retirement planning takes time and strategy. Also, women require more savings than men because of various factors, the most important being the gender payment ratio. If you are still dismissive about the idea as you feel that marriage can act as a buffer for you and your significant other can build a big corpus, we recommend you rethink that strategy.

Recommendations: Retire Rich

There is a possibility that you may remain single, or unfortunately, your marriage may not work, or you become widowed with children. According to the 2011 Census, nearly 74 million single women in India— unmarried, divorced, separated, and widowed—and there was a 39 percent increase in single women between 2001 and 2011. With our tolerance levels lowering, health issues rising, and thought processes evolving, you can only imagine the current percentage increase in single Indian women!

On the other hand, if you’re an entrepreneur who invests most of her earnings back into the business, saving can be tough. In another school of thought, for many entrepreneurs funding a business and saving for retirement may seem like mutually exclusive propositions; they should not be. Now that you know you are seeing more sunsets than men, you know that you will have more responsibilities and more expenses. So act smart and plan your path! Here are a few retirement tips you can follow.

1. Identify Your Needs

Recommendations: Identify your needs

With time, needs always pile up, they never reduce. Keep factors like these in mind while trying to figure out your needs. It would help if you had an exact idea of how much you need so that you can plan better. Depending on your needs, it’ll be easy to make your retirement goals and figure out the methods you need to implement to reach that target. Form a goal so you can strive to meet it!

2. Be Your SAVING Grace

Recommendations: Savings matters

Whenever you get a chance or happen to have some surplus money, instead of spending it on your list of expensive luxuries, try to save it. You might feel bad about missing that chance of pampering yourself, but you will also be forever grateful to yourself for a comfortable retired life. Just remember that retirement savings are your priority. Everything else can wait. And If it seems hard to do so in the initial years because of the temptation to spend, lock the investments through ECS mandate to your bank account.  

Another option is to save more in the Provident Fund by opting for VPF (Voluntary Provident Fund) contribution with your employer and the EPF (Employees’ Provident Fund). It will ensure that the money is deducted from your salary even before it reaches your account. There is no 12% ceiling of mandatory contribution as with EPF, and you can enjoy its tax-free status: tax deduction under Section 80C, no tax on interest, or the maturity proceeds.

3. Invest Wisely

Recommendations: Invest wisely

The best trick to save more, of course, is to invest wisely. For this, it is extremely important to allocate the right resources. With time on your side, it is better to save a little bit less but save regularly. It is okay if you have some debt, but make sure you invest a more significant percentage in equity instruments like equity or balanced mutual funds to ensure you get high returns over the long term. While investing for retirement, you must correctly calculate the retirement corpus, taking into account the eroding effect of inflation and the impact of taxation on your investments.

Start a SIP today – it will help you systematically fulfill your goals. Alternatively, you can start taking small steps towards the bigger game of investments – digibank has got your back – it gives you handpicked portfolio insights, goal-based planning sessions, analyses your portfolio, and sends you communication tailored to your specific needs – to ensure your practice doesn’t stop! Start here.

4. Cover Yourself With Health Insurance

Recommendations: Get Health Insurance

One of the best investment decisions you can make to protect your retirement corpus from depleting is to buy health insurance. Given the high medical inflation of 12-15% and higher incidence of lifestyle diseases, especially in old age, it makes sense to purchase a health cover because it will stop you from dipping into your retirement corpus during a medical emergency. Speaking of emergencies , an unexpected worldwide pandemic is a reason enough to safeguard yourself in these current times.  

Get affordable health insurance on digibank. The policy covers a wide range of treatments and allows you to make tax savings of up to ₹25,000 in a financial year1. There are no medical tests, so that you can get instant, low-cost cover for yourself and your family right now on the digibank app. Find out more here .

5. Bargain Better At Your Workplace

Recommendations: Bargain at workplace

It is another skill that will stand you in good stead. Do not hesitate to bargain for a good increment at your workplace and, more importantly, for a higher salary when you change jobs.  

Since you are likely being paid lesser than your male counterparts in India, it will not hurt to stand up for your due remuneration. The more you earn, the higher the contribution to the retirement corpus, and it may also reflect in your retirement benefits later on.

6. Work Longer

Recommendations: Work longer

Although women tend to live longer than men, they retire earlier than them. There are several common factors responsible for this behavior, like early retirement for a loved one (mostly children). Whatever the reason may be, if you plan to retire early, your retirement planning needs to be rock solid to help you pull through all those income-less years.  

The good part is that women have excellent management skills , and they can continue to work after retirement from the comfort of their homes. It is a good idea because there is a high likelihood that you will live for another 15-20 years. Start planning for your post-retirement career during your working years so that the transition is smooth and the corpus can last longer. Hint: Identify a talent/passion and make it a business even at the age of 50,

it’s never too late! 

7. Consult A Financial Advisor

Recommendations: Meet a financial advisor

In case all this sounds too overwhelming, and you feel like you need some professional help, don’t shy away. Whether it’s a friend or an expert, you’re paying to help you with your retirement planning and other financial plans, go for it. This is a sure-shot way of ensuring that you have enough saved for other things as well as your sunset years.

Contact us here.



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